SEC to Use Info From Investors to Stop GRAM ICO

The regulator’s lawsuit against the company does contain info that was not supposed to be divulged
15 October 2019   920

In preparing the lawsuit against the Telegram Open Network (TON), the US Securities and Exchange Commission (SEC) relied heavily on information received from project investors, CoinDesk reports.

This was confirmed to the Internet publication by the CEO of HASH CIB, Yakov Barinsky, who advised some of the funds that invested in TON. According to him, in September, the regulator contacted the American investors of the project and requested information about the data that was provided to them for its promotion.

I know that the SEC reached out to them asking how the deal was arranged, what information TON shared, what documents have been circulated and whether there was any omission of information.

Yakov Barinsky


The regulator’s lawsuit does contain information that was not supposed to be divulged. In particular, the SEC cites “a presentation for a single investor from the US in January 2018.” To attract him, “Telegram talked about his“ high-level technical service ”and“ the possible return on investment in 0x-50x ”.

SEC used the information received to substantiate the conclusion that during the Gram token sale the placement of unregistered securities.

$27.5 million worth of Grams in early 2018 for tokens that had no use and would have no use at the time of launch, demonstrating its intent to profit from the potential increase in value of Grams.


It was probably investor evidence that enabled the SEC to classify Gram as a security. According to the Howie test, the regulator received confirmation of the fact of investments and expectations of profit from them. In addition, the funds are invested in a regular enterprise and the size of the possible profit does not depend on the efforts of the investor.

However, two other TON investors interviewed by CoinDesk said they were not promised a “0x-50x return.” Such inconsistencies in disclosed information could be another alarm to the SEC.


Malaysia to Regulate ICO and IEO

Rules says tokens can be distributed via venture capitalists and financial institutions without selling shares and without debt instruments
16 January 2020   109

In Malaysia, the procedure for initial coin offerings (ICO) and initial exchange offerings (IEO) has been established. The Malaysia Securities and Exchange Commission (SC) provided relevant guidance for participants in the digital asset industry.

According to the regulator, projects can distribute their tokens through venture capitalists and financial institutions without selling shares and without using debt instruments. It was also established the maximum limit on the amount of funds raised through ICO, which will be 100 million Malaysian ringgit or about $ 24.5 million. No special requirements for investors are provided, that is, both institutional and retail investors will be able to participate in such campaigns.

After the completion of sales, the regulator will monitor the spending of collected funds.

Digital tokens offering can provide another alternative fundraising avenue for early-stage entrepreneurs. This initiative supports Malaysia’s Shared Prosperity Vision 2030 (SPV2030) by supporting the growth of SMEs and micro businesses which are targeted to contribute 50% to Malaysia’s GDP. It also aligned with SPV2030’s aspiration to create 30% high technology Malaysian companies.


Datuk Syed Zaid Albar

Chairman of the SC

In addition, the rules for the functioning of IEO platforms were established. Such platforms, if they operate in the country, must independently register with the agency. In addition, they must carry out the necessary checks to verify the integrity of the issuer, as well as understand the capabilities and characteristics of the token they offer.

New regulations are expected to be established in Malaysia in the second half of this year. At the first stage, SC intends to cooperate with IEO platforms on the issue of identifying satisfactory issuers.